Aave’s decentralized autonomous organization (DAO) is weighing an Aave V4 plan for stablecoin loans backed by Bitcoin (BTC), with LlamaRisk’s proposed 300 BTC cap and 78% collateral factor still awaiting approval.
The Snapshot ballot runs Nov. 6-9 ET. The plan pairs stablecoin loans on Aave with BTC locked inside Babylon’s Trustless Bitcoin Vaults.
Collateral would remain on Bitcoin’s network. An Ethereum-based token would track each position and stay confined to Aave’s lending system.
LlamaRisk suggested opening with no more than 300 BTC in collateral and a 78% collateral factor, but the DAO has not adopted either setting.
Before the ballot opened, Babylon’s native-Bitcoin plan for Aave V4 went through community discussion and a risk review.
A favorable Snapshot outcome would send the proposal to the next stage without opening the market. Market activation would still require a subsequent onchain governance decision, and the ballot is scheduled to close Nov. 9 ET.
